Whether you’re a homeowner, renter, or just a busy single parent, you will need to have a solid home insurance policy in order to protect your family.
There are a lot of homeowners insurance companies out there and it can be hard to choose one that is right for you.
AARP is essentially a large trade association for insurance companies, and one of the things that make AARP stand out from other associations is its home insurance policies.
While some variables cannot be changed, the size of your home, for example, you are in control of a number of factors that can affect the price.
Here are 10 ways to save money on homeowners insurance.
1. Compare Prices
Policy prices vary by company. Do some comparison shopping to make sure you get the best deal and keep in mind that this may not be the cheapest option. It’s a good idea to get quotes from at least three companies. You can call them directly, work with an insurance agent, or get information online.
2. Understand Rebuilding Costs
The rebuilding costs are not the same as what you paid to buy the house. This is because the purchase price includes the value of the land, although the reconstruction costs only apply to the town.
The land is generally not exposed to theft, fire, storms, and other perils, so its value should not be considered when choosing coverage limits.
Otherwise, you may be overpaying for more coverage than you need. The higher your deductible, the lower your premium, but make sure you can afford the deductible in the event of a disaster.
3. Increase Your Deductibles
The amount of money you pay for covered losses before your plan starts is deductible. The higher your deductible, the lower your premiums and vice versa.
If you even collect $500 for deductions, you may be able to save on your annual premiums. Make sure you can meet the deductible if a disaster strikes.
4. Plan Your Policies
Insurance companies reward customers who combine plans. If you buy two or more policies from the same company (eg, homeowners insurance, auto insurance, and umbrella policy), you may qualify for a discount.
Analyze the numbers to make sure the included price is actually cheaper than buying separate policies from different companies.
5. Make Your Home More Disaster-Resistant
Upgrades or improvements that make your home more resistant to damage from fire, water damage, and weather-related disasters can help lower premiums.
Depending on the insurer and where you live, you may qualify for a discount if you upgrade your roof, add storm valves, or upgrade your heating, plumbing, and/or electrical systems.
6. Mention Your Home Security Devices
Most insurance companies offer discounts for homes that have security devices like smoke detectors, burglar alarms, fire extinguishers, sprinkler systems, water leak detectors, gas leak detectors, and closed-circuit locks. If you don’t have these devices now but decide to install them later, be sure to update your policy.
7. Ask About Other Discounts
Depending on the insurer, discounts may be available if you are a new homebuyer, age 55 or older, retired, non-smoker, work from home, or set up automatic payments on your insurance bill.
Be sure to ask if you qualify for any discounts, and check back whenever your situation changes (for example, when you turn 55).
You should also periodically check to see if the company offers any new discounts that you should be aware of.
8. Get Rewarded For Your Business
Many insurance companies offer discounts to reward long-term customers. If you’ve been insured with the same company for several years (or more), be sure to take advantage of the loyalty discounts available.
9. Review your policy every year.
Review your policy every year to make sure you have enough coverage, but not too much. For example, you may need to increase your coverage limits if you buy a new piano or add an addition.
If you sell your Star Wars collections, you may be able to lower your coverage limits or cancel your float, if you have one.
10. Browse Group Cover Options
Your employer may administer a group insurance program. Similarly, some professional groups, alumni, and companies offer discounted packages.
For example, organizations like AAA, AARP, and wholesale clubs offer discounts to their members. Still, just because you’re getting a discount doesn’t mean you’re getting a discount.
Be sure to compare at least three options before making a decision.